Michu endured a tough season last year as injuries prevented him from building on an incredible debut campaign in England, in which he scored 22 times but he only managed to find the net six times in the Premier League last term.
Arsenal, West Ham, Southampton and Crystal Palace have all been linked with moves for the Spanish forward, but the Mirror claims Michu would prefer a move back to Spain with Atletico Madrid.
Diego Costa has left last season's La Liga champions to join Chelsea in a £32 million deal, while David Villa has also left the Champions League finalists and so reinforcements are needed.
The Spanish club have been excellent at producing quality strikers over the past few years and always seem to recover from losing star forwards.
Aguero, Falcao and Costa have all left Atletico in recent years but they have managed to find a suitable replacement each time, though Michu would likely be backup to whoever they bring in to fully replace Costa.
Swansea are reluctant to lose the Spaniard, and have brought in Bafetimbi Gomis on a free transfer to prepare for any loss, though Wilfried Bony could also depart this summer.
If Michu is sold, Swansea will undoubtedly make profit on their investment in the striker they signed for just £2 million in 2012.
Atletico may not follow up on Michu's interest and look at other options, but it looks increasingly likely that the Spanish forward will not be lining up in a Swansea shirt this season.